Finance Committee Agenda and Packet 2020 06 23

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City Council Finance Committee Meeting Minutes 05/19/20 Page 4 of 7 Chairperson Maloney stated his support for a mix of budget cuts and use of fund reserves. Member Lipton agreed, but stated some level of reserves should be held in case they are needed in 2021. Finance Committee Member Lipton stated the building of fund reserves, higher than necessary, are intended for situations such as this. Member Lipton stated that a proportional amount of reserves should be used from all funds, but that painful expense reductions are also necessary. Member Lipton stated the reductions for 2020 need to be much deeper because there are only six months left in the year in which cuts may be made. Finance Committee Member Lipton stated managers should reach out to staff to discuss what specific funding/service cuts may look like, to identify integral functions, and communicate those findings to Finance Committee and City Council. Member Lipton also stated that planned fund balance transfers for the next two years should be reviewed to determine if they still make sense, given certain facility closures and the reduction in services. Chairperson Maloney stated the Recreation Center Debt Service Fund should be monitored to ensure payments may be made should property tax decline in 2022. Finance Director Watson stated that department CIP requests have already been submitted for 2021-2022 budget process, but asked the Finance Committee if they would like to provide parameters for departments to use in submitting their 2021- 2022 operational budgets, and further if the Committee has general capital priorities for 2021-2026. City Manager Balser asked the Committee Members if they wished to discuss acceptable operation levels, or have specific direction for certain City operations. Finance Committee Chairperson Maloney and Finance Committee Member Lipton encouraged staff to use the Finance Committee Members for a "value add" review and prioritization of the CMO recommendations. The Committee and staff discussed scheduling a special work session for this purpose, and to ensure the recommended 2020 budget cuts and budget amendment is ready for the full Council. Finance Committee Members expressed the urgency in addressing the 2020 budget cuts sooner rather than later. Finance Committee Member Lipton stated economic recovery and the Economic Vitality budget should be a priority as well as rebuilding fund balances. City Manager Balser agreed, stating recovery through ongoing business support has been identified as a key issue. The Finance Committee stated that the City Manager and staff should make recommendations. City Manager Balser stated she would meet with department staff and prepare recommendations based on the principals outlined in time for a late June Finance Committee Meeting. 5